Silver has dropped sharply and is now in the USD 70–80 retracement zone. Analysts from OCBC Group Research note that silver’s movements are closely linked to changes in the USD and uncertainties in monetary policy.
The decline into the USD 70–80 range is mainly due to stop-loss orders and margin-selling. Silver is highly affected by fluctuations in the USD, changes in yield, and potential shifts in Federal Reserve policy under new leadership.
This quick decline shows that traders are adjusting their positions, which is consistent with silver’s volatile nature in a bearish market. Even with this downturn, silver remains sensitive to the USD and yield changes, along with ongoing uncertainties about Fed policy.
Analysts stress the importance of the USD 70–80 range for stability. If silver stays below this range, it may fall further to USD 58/60.
The recent drop into the critical USD 70–80 zone is concerning. This instability is largely due to a strengthening US Dollar, which has reached 105.5, along with significant uncertainties regarding new nominations for Federal Reserve leadership. In this environment, any recoveries are likely to be brief.
With implied volatility for silver options at a nine-month high, selling premium might seem appealing, but it’s risky. Expecting erratic trading means strategies like short straddles can face serious risks if prices fluctuate sharply. Currently, the cost of buying protective puts or speculative calls is high due to the market’s nervousness.
We are closely monitoring the $70 level as it becomes a key point for market sentiment. If silver consistently drops below this level, it could trigger more automatic selling, leading to a deeper correction toward the USD 58–60 target. This situation makes put spreads—a strategy that bets on price declines while limiting risk—a worthy consideration if support fails.
We remember the relative stability in the precious metals market in the fourth quarter of 2025, which contrasts sharply with today’s fragile situation. The recent rise in 10-year Treasury yields to 4.35% adds further pressure, making non-yielding assets like silver less appealing. This sensitivity to yields and the dollar was less noticeable before the current uncertainties from the Federal Reserve began.
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